Bitcoin vs. MicroStrategy: Which Crypto Play Delivers Bigger Returns in 2025?

Digital gold faces off against corporate adoption pioneer—investors weigh direct exposure against strategic leverage.

The Pure Play Argument

Bitcoin offers unfiltered access to crypto's flagship asset. No middlemen, no corporate governance—just direct blockchain exposure that cuts through traditional finance barriers.

The Strategic Proxy

MicroStrategy bypasses Bitcoin's volatility with enterprise-scale adoption. The company's massive treasury allocation creates a publicly-traded Bitcoin proxy that traditional investors understand.

Risk Versus Reward Calculus

Direct Bitcoin ownership means riding crypto's wild waves. MicroStrategy shares offer familiarity—but add corporate risk layers that pure crypto purists avoid like legacy bank fees.

Institutional adoption reshapes both plays. Whether you want digital asset purity or Wall Street packaging determines your best move. After all, what's finance without choosing between revolutionary technology and comfortable tradition?

Image source: Getty Images.

Performance: Strategy vs. Bitcoin

That question is particularly difficult to answer, given just how convincingly Strategy has outperformed Bitcoin over the past 5 years. While Strategy is up more than 2,300%, Bitcoin is up just 900%.

Their relative performance really began to diverge in January 2024, as soon as the new spot Bitcoin exchange-traded funds (ETFs) started trading. Since Jan. 1, 2024, Strategy is up 450%, while Bitcoin is up 150%. You can see this very easily in the chart below.

Bitcoin / U.S. dollar chart by TradingView

As a result, it has become fashionable for investors to view Strategy as a Leveraged bet on Bitcoin. As long as Bitcoin goes higher, the thinking goes, so will Strategy. And with the additional leverage, Strategy could potentially deliver double or even triple the returns of Bitcoin. Why would you invest in Bitcoin, if you could get much higher returns by investing in Strategy?

The problem with the Bitcoin treasury company model

There's just one problem, though. The price of Strategy can only go up if the price of Bitcoin goes up. Moreover, investors must be willing to attach a premium to the Bitcoin holdings of Strategy.

That's exactly what was happening back in November 2024, when both conditions were being met. The price of Bitcoin started to boom after the presidential election, and investors were boldly attaching a premium of more than 300% to Strategy's Bitcoin holdings. At the time, Strategy hit a 52-week high of $543, and the stock looked like a slam-dunk play.

But since then, the premium has tanked. According to the latest data from K33 Research, that premium has shrunk to just 126%.

What's particularly worrisome is that the premium might eventually vanish altogether. If Strategy holds $74 billion worth of Bitcoin on its balance sheet (as it does now), then investors will value the company at $74 billion. At that point, there's no advantage to buying Strategy. You buy Bitcoin, and you forget about Strategy altogether.

And that's not all. It's quite possible that Strategy might trade for less than the value of its Bitcoin holdings. According to K33 Research, a quarter of Bitcoin treasury companies are now facing this exact situation; they are worth less than the value of the Bitcoin they hold.

That's going to make it very difficult for them to go out and raise new capital. That means they might be stymied from buying new Bitcoin due to a lack of cash. And that might lead to a collapse in their stock prices.

Simply put, Strategy stock is now trading at the lowest levels it's been at in months, and investors are starting to question the thesis of the Bitcoin treasury company business model. Sure, this model makes sense if Bitcoin is booming. But what if Bitcoin moves sideways or declines?

Buy Bitcoin and sleep well at night

Right now, the better buy is Bitcoin. You get pure Bitcoin exposure, without worrying about all the extra risk of a company continually being forced to raise new capital from investors to buy more Bitcoin.

Still, Bitcoin is hardly a risk-less investment these days. If just one of those newfangled Bitcoin treasury companies fails, it could set off a negative chain reaction, resulting in a huge sell-off of Bitcoin. We've already seen the collapse of one small Bitcoin treasury company, and more could be on the way.

So buyer beware. If you're buying Bitcoin, make sure you're buying it for the long haul, and not as a short-term momentum play.